Useful tips on how to write a compelling investment teaser to capture the attention of potential investors - The Asia Investor

1. How to write a compelling
investment teaser

2. Important notice and disclaimer
Strictly Confidential
Important notice and disclaimer
Strictly Confidential
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What information to include in a teaser?
What is a teaser?
A teaser is arguably one of the most important marketing document in the M&A process. It is a 1 – 2 page
document sent to prospective investors and is the key to attracting the right investors for the business
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A tagline
describing the
opportunity
Accurate
description of
your business
Key high level
financials (e.g.
revenues, profit
and margins)
General
information
about the
opportunity
Describe what
you need the
funds for
Explain the key
advantages of
your opportunity
Set your
valuation
expectation and
implied financial
ratios

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5 key components of a compelling teaser
The key to writing teasers
Investment teasers need to be anonymous, succinct, concise and most importantly, accurate
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• Craft the right investment message into your tag-line and heading
• It should be in no more than 20 words and should include information such as:
– Overview of the opportunity (e.g. sector, location, indication of size)
– Purpose of the teaser (e.g. Sale of the business, seeking minority investment … etc)`
Teaser tag-line and
heading
• Provide a detailed overview of the opportunity including:
– Ownership structure
– History of the business
– Business operations
Business / opportunity
description
• Provide at least three years of historical financials and three years of forecast financials for the key P&L items such as revenue,
gross profit and net profit
• Historical financials should be adjusted to show the true run-rate performance of the business while justification for any
forecast growth should be provided too
Financials
• Disclose your valuation expectations on the investment teaser
• Having a realistic valuation expectation is important, as investors tend to shy away from businesses with inflated valuation
expectations even if the business is an investable one
• Benchmark your valuation expectation against industry comparables
Valuation
• Include three key investment highlights that makes your opportunity a good investment
• It is important to be informative about the investment highlights of the business but be cautious of disclosing any sensitive
information that may compromise your identity or your relationship with your clients
Key investment
highlights
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1. Opportunity to acquire specialised cleaning services business with
contracts secured with blue chip clients for the next three years
– This tag-line provides ample information about the opportunity (i.e. a
specialised cleaning business) and the purpose of the teaser (i.e. seeking
investors for acquiring the business)
– It also enhances the credibility of the business by disclosing the three year
contracts it has secured with blue chip clients
2. Malaysia based offshore services business seeking US$5m from
strategic investors to expand the business into the Middle East
– In this tag-line example, the business owner is very clear about its funding
needs (i.e. US$5m) and the type of investors it is seeking (i.e. strategic
investors)
– It also provides information on the use of funds which would help in attracting
the right investors
3. Fast growing Hong Kong F&B chain seeking minority investment
to open 5 new outlets in Southeast Asia
– This tag-line is brief on the opportunity description but gives details of the type
of investment sought (i.e. minority investment) and the use of funds (expansion
into Southeast Asia)
• After capturing the investors attention with the tag-line, the business /
opportunity description will be the next piece of information that investors
will be interested in
• Key points to note when writing the business / opportunity description:
– The description should be informative and descriptive so that the
investors will have a good idea of the business operation
– Description is factually accurate
• Exaggerating your business operations to attract investors will prove
to be futile as they will conduct their own due diligence before
investing in the business
– Avoid sounding superfluous
Examples of good taglines / headings Business / opportunity description
Crafting the right messages
The tag-line and heading on the teaser will be the first sentence that the investors will read and hence, it is
important that the right message is incorporated into the tag-line / heading
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Company
valuation
Discounted
Cashflow
(DCF)
Comparable
companies
Comparable
transactions
Leverage
Buyout
(LBO)
Each method has its benefits and drawbacks and a combination of 3 or 4 of the below is typically used to determine the final value
Valuation analysis
Company valuation is an integral part of every M&A process for business owners to know if their business
is being fairly valued by the investors
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